Ofcom says invest in next gen broadband

In particular, the regulator says that it wants to ensure that businesses that update fibre optic networks to enable second gen broadband connections get a return on their investment.

Ed Richards, chief executive of Ofcom, said that he is determined to create a business environment that will allow operators to "make and keep a rate of return that is commensurate with the risks they are taking".

He said: "Alongside mobile broadband, [fibre broadband] will, in time, have a similar impact as the first generation of broadband".

"We want investment in a competitive environment. Our position is clear. Ofcom favours a regulatory environment for the next generation of networks and access that both allows and encourages operators to make risky investments, to innovate for the benefit of consumers and, if the risks pay off, for the benefit of their shareholders too."

Ofcom seems to responding to concerns by BT that it is not going to make enough money from investing between £10 billion and £15 billion to cover 80% of the UK with fibre optic networks, which could deliver speeds of 100Mbps.

Meanwhile Sky is alleged to be trialling a fibre to curb project in London.